Correlation Between ASM International and Adyen NV

Can any of the company-specific risk be diversified away by investing in both ASM International and Adyen NV at the same time? Although using a correlation coefficient on its own may not help to predict future stock returns, this module helps to understand the diversifiable risk of combining ASM International and Adyen NV into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between ASM International NV and Adyen NV, you can compare the effects of market volatilities on ASM International and Adyen NV and check how they will diversify away market risk if combined in the same portfolio for a given time horizon. You can also utilize pair trading strategies of matching a long position in ASM International with a short position of Adyen NV. Check out your portfolio center. Please also check ongoing floating volatility patterns of ASM International and Adyen NV.

Diversification Opportunities for ASM International and Adyen NV

0.56

Correlation Coefficient

ASM International  Adyen NV

Very weak diversification

The 3 months correlation between ASM and Adyen is 0.56. Overlapping area represents the amount of risk that can be diversified away by holding ASM International NV and Adyen NV in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Adyen NV and ASM International is a relative statistical measure of the degree to which these equity instruments tend to move together. The correlation coefficient measures the extent to which returns on ASM International NV are associated (or correlated) with Adyen NV. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Adyen NV has no effect on the direction of ASM International i.e., ASM International and Adyen NV go up and down completely randomly.

Pair Corralation between ASM International and Adyen NV

Assuming the 90 days trading horizon ASM International NV is expected to generate 1.07 times more return on investment than Adyen NV. However, ASM International is 1.07 times more volatile than Adyen NV. It trades about 0.23 of its potential returns per unit of risk. Adyen NV is currently generating about 0.09 per unit of risk. If you would invest  38,567  in ASM International NV on April 22, 2025 and sell it today you would earn a total of  13,433  from holding ASM International NV or generate 34.83% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Weak
Accuracy	100.0%
Values	Daily Returns

ASM International NV  vs.  Adyen NV

ASM International

Risk-Adjusted Performance

Solid

Compared to the overall equity markets, risk-adjusted returns on investments in ASM International NV are ranked lower than 18 (%) of all global equities and portfolios over the last 90 days. In spite of comparatively uncertain primary indicators, ASM International unveiled solid returns over the last few months and may actually be approaching a breakup point.

Adyen NV

Risk-Adjusted Performance

Modest

Compared to the overall equity markets, risk-adjusted returns on investments in Adyen NV are ranked lower than 6 (%) of all global equities and portfolios over the last 90 days. Despite somewhat uncertain basic indicators, Adyen NV may actually be approaching a critical reversion point that can send shares even higher in August 2025.

Pair Trading with ASM International and Adyen NV

The main advantage of trading using opposite ASM International and Adyen NV positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if ASM International position performs unexpectedly, Adyen NV can make up some of the losses. Pair trading also minimizes risk from directional movements in the market. For example, if an entire industry or sector drops because of unexpected headlines, the short position in Adyen NV will offset losses from the drop in Adyen NV's long position.

The idea behind ASM International NV and Adyen NV pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.

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Note that this page's information should be used as a complementary analysis to find the right mix of equity instruments to add to your existing portfolios or create a brand new portfolio. You can also try the Transaction History module to view history of all your transactions and understand their impact on performance.